Kellogg Company is pleased to announce that it has reached a recommended tentative agreement for a five-year labor contract with the Bakery, Confectionary, Tobacco Workers and Grain Millers International Union and the four local unions representing 1,400 employees at its U.S. cereal plants in Battle Creek, Mich., Lancaster, Penn., Memphis, Tenn. and Omaha, Neb.
“We value all of our employees. They have enabled Kellogg to provide food to Americans for more than 115 years,” said Kellogg Company Chairman and CEO Steve Cahillane. “We are hopeful our employees will vote to ratify this contract and return to work.”
Highlights from the agreement include:
- Increasing Leading Pay: Employees at our U.S. cereal plants are currently among the highest paid in our industry. The average 2020 earnings for the majority of hourly employees was $120,000, nearly $36-per-hour straight time for our most senior “legacy” employees. The agreement includes increased pay for all of our people, including across the board wage increases and COLA (Cost-of-Living Adjustment) starting Year 1 of the agreement.
- Path to Legacy: Transitional employees have an accelerated, defined path to legacy wages and benefits as compared to the current contract.
- Improving No Cost Healthcare: Most of our U.S. cereal plant employees pay nothing for their healthcare (no premiums, co-pays, or out of pocket costs for prescriptions.) The balance of our workforce enjoy the same health insurance as our salaried employees, but at a much lower cost to them. The agreement further expands already very attractive healthcare benefits, across the board.
- Attractive Retirement Benefits: The majority of our U.S. cereal plant employees have pension benefits – a rarity these days – while others are provided 401(k) plans. The agreement increases those pension benefits.
- No Takeaways: The agreement does not take away anything from our employees. In other words, we are not requesting any concessions from the union.
Kellogg and the union have been engaged in negotiations since Sept. 8 to finalize a master labor contract for its four U.S. Ready to Eat Cereal (RTEC) plants. On Oct. 5, the union decided to strike at all four plants.
The union has stated that employees will be voting the tentative agreement by Monday and the company expects to know the results early next week. This is the second tentative agreement between Kellogg and the union. For a summary of the tentative agreement and regular updates, visit Kellogg’s negotiations website at kelloggsnegotiations.com.
